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At the heart of a new network, Guardian Enterprise Group CEO Richard Schilg stands on the roof of Easton Town Center surrounded by satellite dishes. The city and state have offered help to Guardian in launching the .2 Network, which takes advantage of local stations' extra channels in digital broadcasting.

DIGITAL'SNEWNICHE -

Columbus television network is trying to stake its claim to millions of new viewers in a move
reminiscent of an old-fashioned land grab.

Guardian Enterprise Group has created the .2 Network, a collection of movies, lifestyle shows
and other programming that it's trying to sell to TV station owners across the country. It's hoping
that local television stations run the network on new channels that have become available with the
advent of digital broadcasting.

The state and city are hoping as much, too, because they've recently either recommended or
awarded Guardian tax breaks, grants and a low-interest loan to help the company expand and upgrade
its studio at Easton Town Center.

Last week, the Ohio Department of Development recommended that Guardian receive a $1.1 million
low-interest loan to purchase equipment. That loan must be approved by the State Controlling Board.
Ohio also approved a job-creation tax credit worth $90,000 for Guardian, which has 56 employees and
plans to add an additional 35.

Columbus approved a job-creation tax credit effective for the next five years and also gave
Guardian a $20,000 grant.

The .2 Network (pronounced "Dot Two") has yet to launch and won't until it signs up enough
affiliates to penetrate 30 percent of U.S. households, said President and Chief Executive Richard
Schilg. But Schilg foresees a bounty when station operators realize the value of using the type of
plug-and-play programming that he says the .2 Network offers.

"For the first time in 70 years, as a result of multicasting, there are five times as many
potential TV stations as before," Schilg said. "Stations have added bandwidth but are not using
it."

Because the Federal Communications Commission is requiring stations to broadcast digitally, it's
creating additional channels for them that they can use for programming. WBNS-TV (Channel 10), for
example, would have the opportunity to broadcast on channels 10.2, 10.3 and 10.4.

Some already have taken advantage of the extra space.

WCMH-TV (Channel 4) is showing Retro Television Network on one of its multicast channels.
WSYX-TV (Channel 6) offers My Network TV and This TV.

The programs are available over the air and on cable networks. Satellite operators typically
offer to carry either a station's high-definition or standard-definition programming but not both,
said Ed Clay, station manager of WOSU-TV (Channel 34).

There are about 1,700 local television stations across the country, said Dennis Wharton,
spokesman for the National Association of Broadcasters. That means the potential for thousands of
new multicast digital television channels.

Yet the decision to broadcast additional programming is not an easy one, Wharton said. There's a
chance that more fragmentation would lead to confusion for viewers.

On the other hand, he said, choice is a reality for most viewers today.

"If you can pick up additional eyeballs with enriched programming, why would you not want to be
in that space?" he said.

WBNS General Manager Tom Griesdorn said he's not sold on the concept of multicasting.

"I don't see anything sustaining itself," he said. "It's all based upon, 'How attractive is the
offering?' Are viewers willing to invest time in watching retro TV or movie TV, especially given
the 400-plus channel offerings of cable and satellite now?"

Schilg said Guardian contacted major television companies to create .2 Network's lineup. He
found they didn't want the offering to compete with the main channel, and it had to look like cable
programming, to some extent. So the .2 Network will feature four movies per day, combined with
lifestyle programming and some retro television.

He said Guardian has a multiyear contract in the "tens of millions" of dollars with Sony
Pictures Entertainment to broadcast recent movies.

"I could put up a network, but if it doesn't put up good content, nobody's going to watch," he
said.

Further, Schilg said, the network is unique because it plans to split ad revenue with its
affiliates. The lineup is heavy at certain times of the day with paid programming.

"None of our competitors are doing revenue sharing," he said. "Nobody's doing the level of
quality in terms of content."

Schilg said the network is halfway toward its penetration target, but the clock is ticking.
Guardian originally set a rollout date of early December 2008 for the network. It changed that to
April as the economy soured and the government delayed the mandatory switch to digital
broadcasting. Now, Schilg said, October is more realistic.

"I think everybody recognizes it's a really tough time to launch something right now, but if you
have two or more changes in your launch date, that's not ideal," said Michael Malone, deputy editor
of the trade magazine
Broadcasting & Cable. "What's a challenge for them is that there are a few
fairly similar competitors out there."

Malone said television stations nationwide have said they want to provide local programming as a
part of their multichannel offerings. To that effect, Schilg said, the .2 Network delivers.

The network's equipment can be programmed to automatically pre-empt scheduled shows for local
content.

With movies edited for television, the network in a way harkens to Guardian's past as the owner
of Christian station WSFJ-TV (Channel 51). Guardian sold WSFJ to Trinity Broadcast Network in
September but still broadcasts its signal from the Easton offices.

Guardian also operates local station GTN (Channel 23), which is available over the air and on
some cable services, and a couple of other ventures.

But the .2 Network will feature popular movies, which Schilg said competitors can't match.

"It's truly the best of cable, and we are bringing that to the second channels," Schilg
said.

Mike Pramik covers development for The Dispatch. Contact him at
mpramik@dispatch.com or by fax at 614-461-5107.

• Construction Zone is a weekly look at construction, development and real-estate news in
central Ohio.